Monitoring requires regular reports from the entrepreneurs because they are the ones who know how the start-up is doing – or at least they should know.

Reporting is not only of value to investors. It also helps entrepreneurs to find out if their company is still on track and it helps to enforce discipline. It allows founders to base important decisions on facts.

Preparing reports is advisable for entrepreneurs, even without external investors, as the reporting system is the natural continuation and updating of their planning activities. Every core component of the business model should be subject to monitoring.

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By Jan Brinckmann
Associate professor, Department of Strategy and General Management at Esade Business School